CP 6-4 Required: Choose the method of inventory valuation that corresponds to each of the statements that follow: 1. FIFO 2. LIFO 3. Weighted average. 4. Specific identification _Matches actual flow of goods with actual flow of costs in most cases _Matches old costs with new sales prices _Results in the lowest net income in periods of falling prices _Matches recent costs with new sales prices _Does not assume any particular flow of goods _Best suited for situations in which inventory consists of perishable goods Values ending inventory at approximate replacement cost
CP 6-4 Required: Choose the method of inventory valuation that corresponds to each of the statements that follow: 1. FIFO 2. LIFO 3. Weighted average. 4. Specific identification _Matches actual flow of goods with actual flow of costs in most cases _Matches old costs with new sales prices _Results in the lowest net income in periods of falling prices _Matches recent costs with new sales prices _Does not assume any particular flow of goods _Best suited for situations in which inventory consists of perishable goods Values ending inventory at approximate replacement cost
Financial Accounting: The Impact on Decision Makers
10th Edition
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Gary A. Porter, Curtis L. Norton
Chapter5: Inventories And Cost Of Goods Sold
Section: Chapter Questions
Problem 5.12E
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Cp 6-4
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